Responsibility to reduce or eliminate unemployment
Problem: Who has the responsibility to reduce or eliminate unemployment? What is the role of business? What is the role of government?
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For an economy at full employment, an increase in the quantity of money will lead to which of the following sequence of shifts in aggregate demand and supply curves
Use the marginal productivity theory of labor demand to predict the impact on the firm's employment level of the following events. Explain why the change in employment occurs and show it in a graph.
What determines the real interest rate, saving and investment in the Classical model? What impact does a change in the quantity of money have on the interest rate?
1) What will be the free market wage rate and employment level? 2) Suppose the government sets a $5.00 per hour minimum wage. What will be the employment level?
Explain the difference between the government purchases multiplier and the net tax multiplier. If the MPC falls, what happens to the tax multiplier?
Question 1. Does either country have an absolute advantage? Question 2. Which country has a comparative advantage in technology and by what amount.
Use the insights of the classical and Keynesian views of wages and unemployment to explain the differences in unemployment rates between the United States and Western European countries.
Distinguish between two sources of inflation. Explain why steady inflation is likely to be less harmful to an economy than a situation which inflation rates vary alot.
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